Behavior of Investors on a Multi-Asset Market

Matjaz Steinbacher ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper analyzes the field of investors’ decision-making on a multi-asset market. It does it through a simulation games on a social network framework. It has been demonstrated that more stocks there are in the game and more changing alternatives investors have available to choose from, tougher it is for them to make decisions. Despite in most simulations the safest alternative was dominant, many investors opt for portfolio of the safest and the riskiest stock, by which they back the risk they take with some safe stocks. Non-omniscient investors behave chaotically. In all the cases, liquidity agents proved to be decisive elements of the games, though not always able to deliver the information of all the alternatives when too many alternatives are available.

Keywords: social networks; behavioral finance; portfolio analysis; multi-asset game; chaos (search for similar items in EconPapers)
JEL-codes: G11 Z13 D83 C73 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp
Date: Written
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Persistent link: http://EconPapers.repec.org/RePEc:pra:mprapa:15898

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